Israelis and Palestinians are bracing for more violence and further divisiveness, as hope fades for a Middle East peace deal in the last days of the Clinton administration.

In what could be his last pitch to revive negotiations before leaving office, President Clinton is expected to meet Tuesday at the White House with Palestinian leader Yasser Arafat, who has wavered for more than a week over whether to accept a U.S. plan meant to provide the basis for future peace talks. The meeting would come amid an outburst of renewed...